BEIJING (Reuters) – New home prices in China grew at their slowest pace in 10 months in February as a cooling economy and existing curbs on speculative investment put a dent on overall demand.

FILE PHOTO: Property buildings are seen against the dawn sky in Beijing, China, April 25, 2017. REUTERS/Stringer/File Photo

Average new home prices in China’s 70 major cities rose 0.5 percent in February, slowing from a 0.6 percent gain in January and marked the lowest growth rate since April 2018, according to Reuters calculation of data released by the National Bureau of Statistics (NBS) on Friday.

On the whole, however, it logged the 46th straight month of price increases. Most of the 70 cities surveyed by the NBS still reported monthly price increases for new homes, though the number was down to 57 from 58 in January.

On an annual basis, home prices rose 10.4 percent in February, accelerating from a 10.0 percent gain in January.

Consumer and business confidence has slipped over recent quarters in the face of a slowing economy and the Sino-U.S. trade dispute, which is keeping residential investment in check.

Growth in the world’s second-biggest economy slumped to near three-decade lows last year hit by the tariff row with the United States and Beijing’s multi-year crackdown on debt.

Policymakers appear keen to avoid dealing a sharp knock to the real estate market as it directly influences 40 other business sectors in China and is key to tempering the economic slowdown.

Over recent months some smaller cities have quietly loosened curbs to prop up sentiment and demand.

Policymakers, however, have vowed to flush out property speculators and prevent big fluctuations in housing values as they try to ensure that first-home buyers aren’t completely priced out of the market.

Prices growth in China’s four top-tier cities – Beijing, Shanghai, Shenzhen and Guangzhou – rose 0.3 percent from a month earlier, slowing from a 0.4 percent gain in January, the statistics bureau said in a statement accompanying the data.

Tier-2 cities, which include most of the larger provincial capitals, increased 0.7 percent in February on a monthly basis, in line with the previous month, while in tier-3 cities they rose 0.4 percent, easing from 0.6 percent in January, the statistics bureau said.

Data on Thursday showed China’s property investment quickened in the January-February period driven by strong demand in smaller cities.

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